Champion Minerals Acquires 15
Strategic Iron Mineral Concessions in Fermont, Quebec.
Toronto (Canada), May 27, 2008 - CHAMPION MINERALS INC.
("Champion" or the "Company") (TSX-V: CHM) is pleased to announce the signing of a Binding
Provisional Agreement (the "Agreement") with Fancamp
Exploration Ltd. and The Sheridan Platinum Group Ltd. (collectively, the
"Vendors"), allowing Champion to acquire up to a 70% interest
in 15 iron-rich mineral concessions totalling 261.5 km2 (see appended
Table 1 outlining the mineral concessions) in the Fermont Iron Ore
District of north-eastern Quebec. The Property, also termed the Fermont
Property (the "Property"), is situated 250 km north of the St.
Lawrence River port town of Port-Cartier and centered 60 km southwest of
Fermont.
This transaction represents
Champion's third major acquisition of strategic iron mineral concessions
in the past year, making Champion one of the largest stakeholders of
mineral concessions in the Fermont Iron Ore District of Quebec.
The Fermont Property hosts
significant historic pre-National Instrument ("NI") 43-101
Mineral Resources* of 610 million tonnes @ 32.2% iron, located in
proximity to and locally contiguous to an operating and a number of
former operating iron mines and projects currently being developed for
iron mining. The pre-NI 43-101 Mineral Resources* are divided amongst 7
of the 15 mineral concessions:
Table 2 - Historic Mineral Resources - Fermont Property
PROJECT
NAME
|
TONNES
|
GRADE
(%
iron)
|
NUMBER
OF
DRILL
HOLES
|
MOISE
LAKE
|
101,000,000
|
30.8
|
65
|
O'KEEFE-PURDY-AUDREA
LAKES
|
25,000,000
|
35.5
|
18
|
BELLECHASSE-MIDWAY
|
91,400,000
|
30.0
|
N/A
|
FIRE
LAKE NORTH
|
40,600,00
|
32.0
|
15
|
AUDREY-ERNIE
LAKES
|
23,000,000
|
33.2
|
2
|
BIG THREE LAKES
|
25,000,000
|
34.0
|
N/A
|
SILICATE-BRUTUS LAKES
|
304,000,000
|
29.4
|
18
|
TOTALS
|
610,000,000
|
32.2
|
118
|
* The mineral resources outlined
here are non-compliant NI 43-101 Mineral Resources since they are
historical in nature and
should not be relied upon. There is no direct evidence that these numbers
or any portion thereof will ever be achieved at any time with further
exploration work.
The Moise Lake East mineral concession is
adjacent to the east of Quebec Cartier Mines Mount Wright producing iron
ore mine and it is also located southeast of Consolidated Thompson Iron
Mines Limited's Bloom Lake Deposit (637.7 million tonnes @ 29.8% iron)
that is currently being developed and is expected to produce 7 million
tonnes of iron concentrate per year at a grade 66.5% iron (source:
Consolidated Thompson Iron Mines Limited SEDAR filings available at
www.sedar.com).
The O'Keefe-Purdy-Audrea Lakes, Harvey-Tuttle Lakes, Bellechasse-Midway,
Midway SE, Oil Can Lake, Don Lake, Fire Lake North, Hope Lake, Hope Lake
SW and Cass� Lake mineral concessions tie onto the Quinto Mining
Corporation ("Quinto") Claim Group, which owns the Peppler Lake
Iron Project containing an estimated 250 million tonnes @ 28.2% iron
based on a NI 43-101 Technical Report issued by Quinto in 2006 (source:
Quinto Mining Corporation SEDAR filings available at
www.sedar.com).
All of the iron mineralization on the Property is linked to magnetite
and/or specularite (hematite) iron formations in various proportions. The
Property has received limited historical exploration work; however, the
iron formations tend to have positive relief, the iron mineralization and
ores are easily recognized visually, and they can be explored using
airborne and ground magnetic geophysical surveys. Magnetic highs outline
magnetite-rich iron formations, whereas magnetic lows tend to be
hematite-rich iron formations and zones of secondary iron enrichment due
to near surface oxidation. The historical sizes and iron grades were
determined with minimal drilling, as outlined in the above table of
historical Mineral Resources, and are not compliant with current NI43-101
standards; accordingly, they cannot and should not be relied
upon.
The Fermont Property Agreement
Under the terms of the Agreement, Champion can earn an initial 65%
interest in the Property at the Company's option by expending C$ 6
million in staged exploration and development work expenditures on the
Property, making cash payments to the Vendors totalling C$ 1 million, and
issuing 2.5 million shares to the Vendors - all over a 4-year period. The
Vendors will retain a 3% Net Smelter Returns ("NSR") royalty,
one third of which may be purchased by Champion for C$ 3 million.
Pursuant to the Agreement, and after earning the initial 65% interest,
Champion will have the option to acquire a further 5% interest in any of
the retained mineral concessions in the Property by completing a positive
bankable feasibility study on the applicable retained mineral
concessions. Champion will be required to make a one-time issuance of
500,000 shares to the Vendors on completion of the first feasibility
study.
After Champion completes its earn-in, the Vendors and Champion will form
a joint venture ("JV") reflective of their proportionate ownership
interests in the Property in order to explore and develop the retained
mineral concessions. Champion will retain a right-of-first-refusal on any
part or all of the Vendors' proportionate interest in each of the mineral
concessions comprising the Property. If the Vendors elect not to
fund their proportionate interest in the JV, their interest would be
diluted and, when the Vendors' interest is reduced below a 10% remaining
interest, the Vendors would be left with a 3% NSR royalty subject to a buyback
clause at Champion's option to reduce the NSR royalty to 2% by paying C$
3 million. Champion would also retain a first-right-of-refusal on the
royalty.. There is a 10 km area of influence around each mineral
concession. The Agreement is subject to the completion of due diligence,
the approval of Champion's Board of Directors, and all required
regulatory approvals, including that of the TSX Venture Exchange Inc.
Subject to regulatory approval, Champion will issue 100,000 common shares
to an arm's length party as a finder's fee.
Mr. Tom
Larsen, President and CEO of Champion stated "For the third time in
the past year Champion is proceeding with a major acquisition of
strategic iron holdings, with this most recent acquisition adding more
than 600 million tonnes of historic mineral resources in the Fermont
Mining Camp of northeastern Quebec. The new Fermont holdings are in
proximity to Quebec Cartier Mining's Fire Lake Mine and Consolidated
Thompson's Bloom Lake and Quinto's Peppler Lake deposits.."
"Champion is now strategically poised to become one of the major
players in this region's iron sector. Champion plans to aggressively
explore and develop the 261.5 km2 Fermont Property in addition to the
139.7 km2 Attikamagen Property located in western Labrador and
northeastern Quebec. Both iron properties have excellent potential to
host significant iron resources."
"Champion's near-term aim is to rapidly determine the quality and
size of the iron mineralization at both Attikamagen and Fermont, and
their highest recoverable grades. I would like to take this opportunity
to thank the management team for their efforts and also, Mr.. Jean
Lafleur, P. Geo., Director and Technical Advisor to the Company, for his
role in enabling Champion to build an extensive and highly prospective
iron property portfolio."
The technical content contained in this press release has
been reviewed by Mr. Jeff Hussey, P. Geo., Vice President, Exploration
for Champion Minerals Inc. and a Qualified Person under the
guidelines of National Instrument 43-101.
About Champion Minerals
Champion is a junior exploration Company
focused on discovering and developing significant metal resources in
eastern Canada, particularly in Newfoundland-Labrador and northeastern
Quebec. The Company's projects include the Powderhorn and Gullbridge Base
Metal Projects located in central Newfoundland, the Attikamagen
Property, located in western Labrador and northeastern Quebec, and the
Fermont Iron Property in northeastern Quebec.
Table
1 - Detailing the 15 mineral concessions of the Fermont Property
MINERAL
CONCESSION
|
SIZE
(km2)
|
NTS
MAP-SHEET
|
MOISE LAKE
|
13.3
|
23B14
|
O'KEEFE-PURDY-AUDREA LAKES
|
37.6
|
23B11, 23B12
|
HARVEY-TUTTLE LAKES
|
49.8
|
23B05, 23B12
|
BELLECHASSE-MIDWAY
|
6.9
|
23B11
|
MIDWAY SE
|
8.0
|
23B11
|
OIL CAN LAKE
|
9.0
|
23B11
|
DON LAKE
|
�2.7
|
23B06
|
FIRE LAKE NORTH
|
21.2
|
23B06
|
HOPE LAKE
|
�6.9
|
23B06
|
HOPE LAKE SW
|
3.2
|
23B06
|
CASS� LAKE
|
13.5
|
23B05
|
AUDREY-ERNIE LAKES
|
28.1
|
23C01, 23B04
|
BIG THREE LAKES
|
4.8
|
23C01
|
AUBERTIN-TOUGARD LAKES
|
28.1
|
23B04, 22O13
|
SILICATE-BRUTUS LAKES
|
28.6
|
22O13
|
TOTALS
|
261..5
|
|
|